One of South Korea's most wanted fugitives and former gang boss, Cho Yang-eun, has been arrested in the Philippines and is set to be handed over to the South Korean authorities, Seoul police said on Tuesday, confirming an earlier media report from China.

Seoul Metropolitan Police Agency said the 63-year-old Cho, wanted for charges of fraud, was arrested inside a casino in the northern Philippine city of Angeles.

Earlier on Tuesday, China's Xinhua news agency, from Manila, reported the arrest of Cho, citing the Philippine Justice Secretary Leila de Lima.

Seoul police said Cho will be returned to South Korea by Thursday at the earliest.

Cho was the boss of one of the three major criminal syndicates in the 1980s in South Korea. He faced charges of loan application fraud in 2010 and had been hiding out in the Philippines since June 2011, according to police in Seoul.

Cho was later placed on Interpol's Red Notice list, and his passport was invalidated in March last year.

Seoul police said Cho also assaulted and extorted money from a South Korean resident in the Philippines.

According to an official in Seoul, Cho is being detained in the Philippine immigration bureau and an investigator from the South Korean capital will travel there to bring him back. (Yonhap News)